Leading Indicators Predict Slow Recovery

At this point, pretty much no one is expecting a strong, steep economic recovery. The sort of best-case scenario would be a slow recovery, while the worst-case scenario would be a double dip recession. In that context, the Conference Board's Leading Economic Indicators Index for July is somewhat good news: it implies a slow expansion through the rest of 2010.

The index was essentially flat in July, growing by just 0.1%. That followed a 0.3% decline in June and a 0.5% rise in May. Here's the chart:

You can see that the index is clearly settling between 109 and 110, as it has been in that range since early 2010. Conference Board economist Ken Goldstein says that this points to a slow recovery through the end of the year:

"With inventory rebuilding moderating, the industrial core of the economy has moved to a slower pace. There appears to be no change in the pace of the service sector. Combined, the result is a weak economy with little forward momentum. However, the good news is that the data do not point to a recession."

So things aren't getting a lot better, but at least they also aren't getting worse. Unfortunately, it looks like that's about as good as we can hope for at this point.

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Daniel Indiviglio was an associate editor at The Atlantic from 2009 through 2011. He is now the Washington, D.C.-based columnist for Reuters Breakingviews. He is also a 2011 Robert Novak Journalism Fellow through the Phillips Foundation.